Amazon, the bookseller, grew into a technology company with more than 2,504 patents as of 2019. It has branched out into search -- but not just for advertising.
Amazon expanded into search to bring all the silos of data together across its companies. This data is making Amazon, the ecommerce business, a powerhouse. Here's how.
Amazon Technologies, the research and development arm of Amazon.com, on April 6 received a patent grant from the U.S. Patent and Trademark office. It describes a data-mapping protocol that securely associates the account user information stored in the user pool with related account identity information stored in a pool of information, making the account information searchable, regardless of the pool in which the information is stored.
The company calls it a mapping service. In other words, the technology allows a user to search across multiple silos of data to identify a person. The login credentials from a user and the account identifier from the identity are associated with each other in a searchable data structure.
The user account is given an account identifier that identifies the account independently of the login credentials. The account identifier may be associated with the login credentials via an internal account credential so the user can access their account using the login credentials. It will be interesting to see whether this identifier becomes a targeting device.
In March, Amazon updated a patent that was filed in 2018, which dynamically inserts content into a video. The content can include, for example, advertisements, public service announcements or warnings, blurbs to censor other content, live or prerecorded commentary, and more.
With the rise of video and new requirements to connect queries and information in videos, search technology will expand within Amazon -- whether in advertising or as the backbone to the company’s ecommerce and video businesses.
Meanwhile, Amazon continues to make gains in digital advertising at the expense of Google, taking market share in search advertising, according to a recent report from eMarketer.
The research firm estimates that Amazon’s search ad business will reach $14.53 billion in 2021, boosting its share of U.S. search ad spending to 19.0% -- up from 13.3% in 2019. Estimates suggest its share will surpass 20% by the end of 2022.
Search remained dominant in 2020, with a 42.2% market share, but digital video experienced the most growth in revenue and market share, according to the Interactive Advertising Bureau (IAB).
The IAB's annual report, released Wednesday, notes that search drew in $59 billion in revenue -- up 7.8% vs. 2019. Despite the dominance of search, market share fell by 1.7% compared with 2019.
Digital video generated $26.2 billion in revenue last year, rising 20.6% since 2019, and now holds an 18.7% share of total internet advertising revenue for 2020. Display generated $44 billion in 2020.
Display advertising in the fourth quarter of 2020 experienced the strongest growth in revenue -- but search, digital video and other media saw progress.
Search generated $18.7 billion in revenue for Q4 2020 -- up from $15 billion in the year-ago quarter. Display rose 35.4% to $14.8 billion. Digital video rose 32.2% to $8.6 billion, and other rose 19.5% to $3.5 billion, respectively.
Amazon’s ecommerce advertising business, which includes search advertising and display ads on its retail properties, accounts for roughly 89% of Amazon’s ad business. The remainder of Amazon’s ad revenues come from ads on its video platforms and off-property ads sold through Amazon DSP.
This year, Amazon will control 76.2% of the nearly $24 billion ecommerce channel advertising market.
For comparison, at No. 2, Walmart will capture just 6.5% of the market.